oil prices

After 13 years of independence, Timor-Leste has achieved tremendous progress since being ravaged by conflict – drawing down money from the Petroleum Fund and channeling it through the budget to meet pressing development needs. The effectiveness of this process is evident in the near-halving of infant and child mortality rates; a doubling of school enrollment and access to electricity; economic growth surpassing regional neighbors; increasing citizen participation and; the gradual strengthening of state institutions– all culminating in better lives for Timorese today.

“Never let an opportunity pass by, but always think twice before acting,” says a Japanese proverb with particular pertinence for East Asia today.

Plunging oil prices present a significant opportunity for most of the region’s developing countries to strengthen the competitiveness of their economies and take advantage of the ongoing global recovery.

The drop in oil prices — over 50% since mid-2014 — reflects several years of increasing oil supply, particularly in North America, along with decreased geopolitical risks to global production, OPEC’s efforts to maintain production levels and market share, and weaker-than-expected global growth last year. These factors are likely to persist, with oil prices expected to remain low through at least 2016.

Most countries in East Asia, including Japan, benefit from the price decline because they are oil importers. They can expect more rapid economic growth, lower inflation and improved current account balances.